Market evolution: Nickel powders and flakes (CN 7504) — 2015–2025

Introduction

This report analyses the evolution of European Union (EU) trade in nickel powders and flakes (customs code 7504) from 2015 to 2025. The period is characterised by a fundamental shift in the EU's trade position, transitioning from a region with a strong import dependency to one achieving near trade balance and displaying significant export growth. This transformation was driven by evolving production capabilities, changing partnership dynamics, and increased price volatility in global markets. The analysis is based on trade flow data between the EU and non-EU countries.

1. From Import Dependency to Export Competitiveness: A Structural Shift in the Trade Balance

The most significant dynamic over the decade is the dramatic improvement in the EU's trade balance for nickel powders. The region moved from a substantial structural deficit to a position of near equilibrium and even occasional surpluses, propelled by a remarkable expansion in export volumes and values.

The Deficit Narrows Dramatically

The EU's trade balance in value terms began the period with a deficit of approximately €73 million in 2015. While fluctuating, the overall trend was one of reduction. By 2025, the deficit had shrunk to around €13 million, representing an improvement of 81.9% from the starting point. Notably, in some intermediate years (such as 2022), the EU recorded a trade surplus, reaching a peak of approximately €33 million. This indicates a period of temporary export dominance.

Explosive Growth in EU Exports

The improvement in the trade balance was overwhelmingly driven by a surge in EU exports. Export value increased by 187.2% over the period, rising from €37.6 million to €108.1 million. While import value also grew, it did so at a much more modest pace of 9.7%, reaching €121.3 million. The peak export value reached an impressive €219.7 million in 2022, coinciding with the trade surplus. This growth in exports was supported by a 74.0% increase in exported quantities, from 2,301 tonnes to 4,005 tonnes.

Price Dynamics Favouring Exporters

Unit price trends further underscore the EU's strengthening position. The average price of EU exports grew by 65.0% (from €16,357/t to €26,992/t), while import prices rose by 32.1% (from €17,146/t to €22,649/t). This divergence suggests that EU producers may have been able to capture higher value or that the composition of exports shifted towards higher-value products, enhancing the profitability of the export boom.

Source: EU Trade Overview for CN 7504

2. Geographic Reorientation of Trade Flows and Partner Volatility

Alongside the shift in the balance of trade, the geographic pattern of the EU's partnerships for nickel powders underwent significant changes, characterised by rising volatility and the emergence of new key partners.

Diversification of Import Sources but Persistent Dependence

The EU's import sources became slightly less concentrated, as indicated by a 15.0% decline in the Herfindahl-Hirschman Index (HHI) for import value. The United Kingdom remained the largest single import source, though its share fluctuated. Notably, imports from China grew spectacularly by 322.6%, while those from Türkiye surged by 777.2%. In contrast, imports from traditional partners like Canada and Australia showed relatively flat or negative growth. The United States also solidified its position as a key supplier, with import value increasing by 29.5%.

Exports: A Race to Asia and Beyond

The pattern of EU exports was even more dynamic. Export concentration increased (HHI up 71.1%), but this masked a rapid and volatile pivot towards Asian markets and the United Kingdom. Exports to China grew by 450.1%, to Taiwan by 384.4%, and to South Korea by 17.0%. The most dramatic increase was in exports to the United Kingdom, which surged by 555.9%, making it a top destination by 2025. This contrasts with a more moderate increase of 165.1% to the United States. The high volatility coefficients for exports to partners like Viet Nam (2.83) and China (1.01) indicate that these trade relationships were subject to significant year-on-year fluctuations.

High Volatility as a Market Feature

Volatility analysis reveals that many key trade relationships were unstable. For instance, imports from the Republic of Korea (CV of 2.32) and exports to the same country (CV of 1.27) were highly volatile. The data also detected specific supply shocks, notably a price shock in exports to the Republic of Korea in 2023, where prices surged by 140.8%, and a shock in exports to the United Kingdom in 2019.

Source: EU Trade Partners for CN 7504 | Volatility and Shocks Analysis

3. Evolving Production Base and Shifting Internal Market Structure

Underpinning the external trade shifts was an evolution within the EU's internal market structure, marked by growing production and a distinct specialisation pattern among member states.

Significant Growth in EU Production

The EU's production of nickel powders and flakes showed strong growth, laying the foundation for the export surge. Production quantity increased by 109.1% (from 1.67 million kg to 3.50 million kg), while production value rose by 134.9% (from €42.6 million to an estimated €100 million). This growth, however, was not linear, with production volumes experiencing a peak at 8.43 million kg before settling at the 2025 level, suggesting possible capacity adjustments or market fluctuations.

Specialisation: A Core of Few, a Periphery of Many

An analysis of export specialisation in 2025 reveals a highly concentrated production landscape. Only a few member states showed a strong comparative advantage (RSCA > 0) in this product:

• Finland was the most specialised, with an RCA of 12.0, accounting for 12% of EU production in this sector despite a small overall industrial share.
• Ireland, Germany, Sweden, and the Netherlands also showed positive specialisation, with Germany being the largest producer by volume (35.9% of EU production).

Conversely, the vast majority of member states, including many from Central and Eastern Europe, showed very low or negative specialisation (RSCA < -0.98), indicating they are not significant producers or exporters of this niche product. This structure points to a highly geographically concentrated production base within the EU.

Net Import Reliance Continues to Decline

The metric of net import reliance (NIR) encapsulates the overarching trend. It started high at 69.7% in 2015, confirming strong initial import dependency. It fell dramatically, even turning negative (-19.6%) in 2022 when the EU was a net exporter, before settling at 33.9% in 2025. The 51.4% decline over the period confirms the structural move towards greater autonomy, though the EU remains a net importer in value terms by the end of the period.

Source: EU Market Specialisation for CN 7504 | EU Production Volumes | Net Import Reliance

Conclusion

Between 2015 and 2025, the EU market for nickel powders and flakes (CN 7504) underwent a profound transformation. The primary narrative is the region's successful pivot from a position of significant import dependency to one of robust export competitiveness. This was achieved through a combination of substantial growth in domestic production and a strategic reorientation of export flows towards high-growth and volatile markets in Asia and the United Kingdom.

While this shift reduced overall net import reliance, it also introduced new vulnerabilities, as evidenced by the high volatility in key bilateral trade relationships and concentrated export markets. The internal EU market structure remains highly specialised, with production concentrated in a handful of member states. Looking forward, the EU's position in this market appears fundamentally stronger than a decade ago, but its stability may be tested by the very partnerships that fuelled its export growth.